SK Hynix Approved by China for 'Intel Business Unit Acquisition'... Strengthening NAND Competitiveness (Comprehensive)

[Image source=Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] SK Hynix has obtained approval from Chinese antitrust authorities for its acquisition of Intel's NAND flash business. Having secured China's approval, considered the most challenging hurdle in the acquisition process, SK Hynix is expected to swiftly proceed with related procedures, strengthening its competitiveness in the NAND sector and solidifying its position as a memory semiconductor powerhouse alongside DRAM.

According to business circles on the 22nd, SK Hynix announced that it received approval from the State Administration for Market Regulation (SAMR) of China regarding the acquisition of Intel's NAND business unit. SK Hynix had consistently stated its intention to obtain China's approval within the year. Accordingly, the approval process from antitrust authorities in eight countries required for the acquisition has been completed.

An SK Hynix official said, "We sincerely welcome this approval from SAMR," adding, "We will continue to proceed with the remaining processes and strengthen competitiveness in the NAND and solid-state drive (SSD) businesses."

SK Hynix signed a contract last October to acquire Intel's NAND business unit for $9 billion (approximately 10.3 trillion KRW) and has been undergoing approval procedures in eight countries. After receiving approvals from seven countries?including the United States, South Korea, Taiwan, the United Kingdom, the European Union (EU), Brazil, and Singapore?by July, market concerns grew over delays in China's approval, potentially disrupting the acquisition process.

In particular, amid escalating US-China tensions over semiconductor dominance and reports that the import of extreme ultraviolet (EUV) lithography equipment to SK Hynix's Chinese factory was blocked due to US opposition, there were even suggestions that the Intel NAND business acquisition might fail. Recent cancellation of the MagnaChip Semiconductor acquisition also raised concerns about its impact on approval decisions.

However, SK Hynix overturned these concerns and is expected to further strengthen its NAND business. Having obtained approval from the Chinese government within the year as planned, SK Hynix intends to quickly proceed with the remaining acquisition steps. Initially, it will pay $7 billion to secure the SSD business and assets of the Dalian factory in China, followed by a $2 billion payment on March 2025 to acquire NAND wafer design and production-related IP, as well as operational personnel at the Dalian factory.

Once part of the acquisition process is completed, SK Hynix is expected to expand its NAND business based on a newly established company headquartered in the United States. In August, Robert Crooke, Intel's Vice President, announced on his social network service (SNS) that "a new company headquartered in the US will be established," and that he would serve as its CEO. SK Hynix has already established more than ten subsidiaries worldwide, including in the US, to handle NAND sales and related operations this year.

According to market research firm TrendForce, SK Hynix held a 19.3% share of the NAND market in the third quarter of this year, ranking third, while Intel held 5.9%, ranking sixth. Combined, their share amounts to 25.2%, surpassing Japan's Kioxia (19.3%) and positioning them as the industry's second-largest player after Samsung Electronics (34.5%).

This content was produced with the assistance of AI translation services.